Saturday, November 17, 2018

Late on Friday Tata Sons partly confirmed that discussions with Jet Airways have been preliminary and no proposal has been made. This broke weeks of silence which both parties have maintained since the story on Tata Sons looking to take a stake in Jet Airways first became public.

Speculation about Tata Sons’s proposed buyout of Jet Airways has been doing the rounds for a couple of weeks. However, on November 13, senior Jet Airways’ officials said, in an analysts call, that they were in talks with multiple parties for a stake sale in JetPrivilege Private Limited (JPPL) and fresh equity infusion into the company. However, they gave no specifics.

Jet Airways is looking for a cash infusion to keep its operations going. Sources have also confirmed to BusinessLine that the issue of whether the Tatas or someone else will provide funding to the loss-making airline was not discussed either officially or unofficially at the airline’s recently’-concluded board meeting in Mumbai.

Sources also confirm that Jet Airways’ management’s current mandate is keeping the airline running till it finds a new investor. In this context, sources point out that the airline pays its statutory dues and has nothing outsranding to banks, airports or fuel companies. The airline has also put in place cost-cutting initiatives.

.Sources maintain that several seniors in the company are not too keen to invest in another airline, which will require immediate induction of funds. Jet Airways posted a loss of over ₹1,200 crore for the quarter ended September 30.

Tata Sons has is already invested in Vistara — a joint venture with Singapore Airlines and AirAsia India — as well as a joint venture with the Malaysia-based AirAsia . Neither is listed but are said to be in need of more funds as they are supposed to be running in the red.
16/11/18 Ashwini Phadnis/Business Line